19 Sep SWIB gets more pressure to invest in state tech start-ups
Madison, Wis. — As lawmakers and business proponents pressure the State of Wisconsin Investment Board (SWIB) to invest more in Wisconsin technology start-ups, improving business conditions may foster just such investments.
A month after SWIB brought in investment representatives to discuss the Wisconsin high-tech start-up scene, State Sen. Ted Kanavas (R-Brookfield) met with SWIB executive director David Mills last week to further “to explore ways SWIB could increase investment in high-tech, early stage Wisconsin companies,” Kanavas said.
The scene continues to be one of tempered interest for SWIB. While the board remains interested in investing in Wisconsin companies, it is bound by its fiduciary responsibilities, which make return on investment its primary focus.
But other efforts to bolster Wisconsin’s entrepreneurial environment may foster a higher level of SWIB investments.
“Clearly, there are some interesting things happening,” Mills told Wisconsin Technology Network after his meeting with Kanavas. Among those “interesting things” are increased angel investment activity in the state and new-business developments. Additionally, some Wisconsin investment funds are entering new rounds of fund-raising, he noted.
“We hope those produce opportunities” for SWIB to invest, Mills added, noting that the board remains committed to looking in Wisconsin for investment opportunities.
Kanavas, chairman of the Senate’s Job Creation, Economic Development and Consumer Affairs Committee, said he was encouraged by his discussion with Mills, but he pressed for more investment activity.
“I believe that SWIB can and must help us invigorate our venture capital community by making significant investments,” Kanavas said. “There are many good opportunities to be found in this state.”
Wisconsin’s investment in venture capital lags behind other states in the U.S., Kanavas noted. “Even our state’s neighbors did a better job investing in start-ups,” he said. “According to the National Venture Capital Association, Wisconsin posted $57 million in venture capital that assisted nine companies in 2004. In contrast, Minnesota invested $370 million in 40 companies, Illinois $270 million in 39 companies, Michigan $147 million for 120 companies, Indiana $66 million for six companies and Missouri $62 million for 11 companies.”
SWIB has roughly $70 billion under management and is the 23rd largest public or private pension fund in the world. Currently, SWIB’s investments in private equity represent a small portion of its overall fixed retirement fund investments.
Mills said, “The investment board and staff are well aware of the positive effects that result from successful investments in Wisconsin, both for beneficiaries of the trust fund and the broader Wisconsin economy.”
Kanavas said he and Mills would meet again in November to continue to review the investment situation.
— See previous WTN coverage of this issue:State investment board keeps an eye on Wisconsin’s tech trends